Kenya Airways Ltd popularly known as KQ is Kenya’s flag which was founded in 1977 after the dissolution of the East Africa Airways. The carrier’s head office is located Nairobi,Jomo Kenyatta International Airport.The national carrier, announced a Sh 4.7 billion loss for the first half of its financial year ending September 2012, down from Sh 2 billion after tax profit recorded over the same period in 2011. The management stated that the loss was due to declining passenger revenues, strengthening of the local currency and escalating costs. The airline said that the cut in capacity on the London route also significantly affected its revenues as Europe accounts for about 30 per cent of its total income.
In Nairobi, the company share priced dropped by 3.6 per cent to close at Sh12 down, after opening at Sh12.45 per share and this has been the biggest fall since 21st September 2012.
The Sh 826 million one-off staff retrenchment costs also hit the airline’s first half performance but it expects a Sh1.2 billion in savings going forward every year.
Security concerns in the country also affected Kenya Airways, with several travel advisories being issued in the period. The eurozone crisis slowed tourism and threw the global aviation industry into turmoil.
There was a 50 per cent drop in travel to the coast, which is Kenya’s main tourist destination and this is likely to impact the overall earnings for the country.
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